Browsing by Author "Storo, Christine"

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    Risk Analysis in Post-Conflict African Countries: Sierra Leone as a Case Study
    (Stellenbosch : University of Stellenbosch, 2010-03) Storo, Christine; Lambrechts, Derica; Swart, G.; University of Stellenbosch. Faculty of Arts and Social Sciences. Dept. of Political Science.
    ENGLISH ABSTRACT: Political risk analysis is considered one of the essential ingredients in decision making processes when investing abroad. The Iranian Revolution and the oil crisis in the 1970s accentuated this need as investors increasingly felt the need for a proper assessment of the risks involved in establishing a business in other countries. Negative images of African countries combined with conventional risk models which are not able to accurately assess the political risk realities of post-conflict African countries, may be one of the reasons for why African countries struggle to attract a substantial amount of FDI. This study suggests that alternative risk models which are more African-orientated may aid in improving this situation. This study has analysed the political risk of Sierra Leone using a conventional risk model, and an African-orientated political risk model. The aim of this study was to assess whether conventional political risk models need to be adjusted to be able to more accurately assess the political risk of post-conflict African countries. The main research question guiding this study was:  Are conventional risk models able to objectively rate the political risk of post-conflict countries in Africa? The conclusion of this research was that African-orientated political risk models are able to more accurately assess the political risk of a post-conflict African country such as Sierra Leone. This is mainly due to the soft variables used in a political risk model and also the relationship between the variables included in the models. The African-orientated political risk model needs to be analysed further, but this research has made clear the need for a reevaluation of existing political risk models to be better equipped when analysing post-conflict African countries. This will not only benefit African post-conflict countries in improving their risk ratings, but also provide foreign investors with a more accurate identification of the potential political risks facing an investment in post-conflict African countries. It was acknowledged in this study that the political risk analyses of Sierra Leone were not conducted by someone who has inside information of the political risk models used which is a limitation iii for the results of this study. It is, however, possible to detect potential weaknesses with each political risk model and possible areas of improvements.